good morning and welcome to "squawk box" here on cnbc. i'm andrew ross sorkin along with joe kernen. becky quick continues to enjoy some time off. steve ballmer introducing himself to l.a. clippers fans at a rally. clapping and shouting. he was nearly hoarse. he ran around to the song "lose yourself." >> yes, i do live in seattle. no -- we can all love seattle. there's no team there. weir not moving the clippers to seattle.

for a hundred reasons, but i think i've got the one that people understood is we bought l.a. beach front, not seattle beach front. >> and ballmer gave out his e-mail address to 4,000 plus fans that were in attendance. we're going to talk more about sports later in the hour. also coming up, our dom true. he sats down with rory mcilroy last night. it was a busy need for rory pep appears on the "tonight show." >> tiger, will you be be my coach? >> yeah. i'm hitting the ball to find out for you. >> i love it. you're my caddie. this is the best thing ever. >> they're in new york for the start of the barclay's and the fedex cup. so a little bit of fun. >> i've seen that interaction before. i guess he doesn't remember when

we used to jump around like a monkey. same act with microsoft and the stock prices stuck at 25 for like 16 years. -- if you buy a team, that's not really a new job. it's a team. his job is sitting on the floor and having starlets come up, don't you think? >> yeah, you buy a team you want it to win. >> he's a sales guy. selling. >> a sales guy is probably -- >> you were a sales guy. >> i was. >> did you do that? >> no. he's probably the richest salesman in the history of the world. 20, right? i believe he's worth 19 -- and then that's tiger and rory.

i hope that's not a true passing of the pa done yet. it almost looks like when you swing that hard and you buy a lot of the great players, boats just don't hold up. >> i remember when it happens, he said he was fine. >> he said his knee, too. he's had a few things. and rory, he had an entire farm i think rory could have had a great -- we'll see. we'll talk to -- is is his name dave? >> dave greg is going to join us. the dow and s&p 500 are now less than 2% off record highs. futures this morning, they're going to consolidate a little from yesterday where the nasdaq closed at a 14-year high. there's the s&p back to 19 or

whatever. so it's up 22 points. 170 points. so yesterday for today, the test in the market will be the inflation data. the july cpi. housing starts, both of those are coming at 8:30 eastern. and on the earnings front, home depot is out. i haven't looked at where the stock is trading based on this. but home depoint reported -- i'm sorry? there it is. it's up $2.41. is that -- normally that's an all-time high. must be close. i'll having a hard time -- >> become but $ 1.823 r 2. 6.4%. in the u.s., total sales 23.8.

that was above the 23.6 billion that was expected. and total sales up 5.8%. and we're above where expectations are at 441. and the seasonal business in the spring rebounded. it said in the second quarter, it was in the core of the stror and across all geographies, things are better. so i think that's probably an all-time high, although it's not getting any help from my machine. >> i'm not getting any help with my machine, either. >> i'm trying to play the news edge game. >> news edge i'm fine on. the nasdaq closed about 4500 for the first time since march 2000. while many are cheering the pep rally, there are still many names that haven't gone back to their highs. the story in "usa today" where i

get my business info, it highlights ten big names in the nasdaq and it is still still surprising. >> yeah. did you hear the names? i would have thought that syria's xm would have been a net winner. >> sirius x's xm has never been more than a penny stock. >> which is stocking to me. >> do you think why? >> because of the huge investment made initially. >> because there were too many shares. and then the other one, intel, it's a social media world now. all the -- you know, the old stallwarts, it's just not the same. sitsco has never been back to

$80. and still having trouble. it included how many layoffs? but this is totally different. it's new tech that has the nasdaq back where it is. not totally, but think about google, apple. but apple back then, how much was that worth back then? >> probably worth under $100 million. >> and just a series of guys that have no idea what to do. >> next i had ran national semi conductor.

shares are rehiring its former ceo, julian geiger. aeropostale is trying to bounce back from losses. >> do you think i would shop with my teenage daughter? >> you might do that. >> would you like to do that? >> no, no, no, that's not what i -- >> why would i even think about enter ago teen store trying to -- >> i can't pick out. i can't pick out my own clothes? would you be able to shop for -- >> i could. we're going to buy cargo shorts against my wife anticipates wishes. >> can't you focus for paying for what they pick out?

that's my story. i will not even enter the -- i usually stay out in the middle part of the mall with the seats and starbucks and things like that. >> because you know living in new york city, we don't have malls, we have big bizarres. >> that's your loss, isn't it? another retailer to watch this morning, urban outfitters, inline with expectations as vestors focus on a 10% drop in same-store sales. sprint cutting rates as it tries to learn new customers, that company unveiling a new plan that unveils 20 gigabytes of data and up to ten lines for $100. amazing deal. sprint says additional plans are still to come. t-mobile has expanded its family plan. >> no gig is a word that means a lot? >> but what am i used to used

per month? >> 5, 5, 10. >> and i'm using that mostly with texting? >> usually the videos that you don't like to talk about. >> if you need to talk, you need to switch the set off. >> you're missing my joke. >> oh, no, no. >> that's what's taking the -- the demand with.the. sprint now making a plan for fighting the low wars. >> becky and out and gets to spent this year. home depot is going to help as a dow component. everybody says, wow, oil should be much higher based on all

this. which tells me if there wasn't all this stuff happening, it would be lower. the ten-year yesterday, it's definitely more attractive. at this point, it's the current thing to watch. because it matters what happened in items of the economy. but i look at that 1.33 and the euro is getting into what seems like a more appropriate level. it's from the style of managing the economies over there. and then -- let's take a look at gold which also with everything happening you think would be -- here he is, as i said. jim paulson is not here. he's with love capital management. that's not him. that's him. that's david beyonker sitting right next to me, deutsche

bank's chief equity strategy. paulson, i hope given that you were on like a week ago, i hope you at least thought of something else you could say since we have faithful viewers. they'll know if you're tuning in the same slop today. >> it's the same slop. >> you've been right for that long, it's okay. and i meant -- like you're on a food place. >> what's the -- >> today, it's come back again. it did not do the 10% pullback again. >> no, it hasn't, joe. i think heesh is my take, i guess. i think the economy has moved up to 3% growth. i think most investors think that's the case. and the question is, if you now have notched up to 3%, can you grow like that without any interest rate or inflation consequences? and if you can, that's nirvana. that's -- territory. that could take a market move like we had in 87 or in the late 90s.

or are we eventually going to get some inflation and interest rate pressures and move the fed's timetable up in which case, you know, we could still get a correction. i lean a little bit towards the latter, but maybe we have to break through 2000 first. i think we're just one hot wage number away from a different mind-set on wall street regarding whether good news is indeed -- >> i think you might be -- >> nirvana. >> i'm starting to wonder about you, jim. and i'm tell you why. well, i have for a while, but number one, we had the -- >> i like it. >> yesterday it was said corrugated boxes indicating nothing better than a 1% economy right now. and then we keep looking for answers for why the consumer doesn't feel confident, why the consumer is not spending for us. you said because there's no money in the consumer's pocket. so it's starting to look more and more like the stock market is disconnected from the

underlying economy. if corrugated boxes are only -- if it's a 1% world according to him, then the only reason you're right about all this with the market getting higher and higher is because the fed is juicing it. >> yeah. i just disagree. >> how do you disagree with a guy who knows about -- if it's 1 is% with what's being shipped in corrugated boxes and he knows -- what do you know? what's your data? >> well, i guess, i got the ism reports are all in the midst of the nonmanufacturing reports. you've got the strongest job creation of the entire recovery in the last six months, the biggest drop of the unemployment rate in the last year. >> are they all part-time and is the participation rate still going down? >> i don't think they're all part-time. and i think that consumer confidence majors, you know, are close to the highest levels of the entire recovery. they're close to the highest level since 2008. you happen, i think that the

good orders are showing some life. >> bianco, does he know anything? >> yes, actually, i think he's spot on. >> you know, the more guys that agree, jim, that's a bad sign. >> dave and i together could fail. >> it's what we've been thinking for a while and certainly the whole year. he has investors, everybody seeming to em brice. not quite as slow for the long-term, but 5%, 6% earnings growth over the next few years. longer term rates have done nothing but go down this year, even as the labor market has improved. and the participation rate ticked up in the jobs report last month. i think that's more about the

fed chair janet yellen she'll highlight the importance of trying to get a higher participation rate, a move from part-time jobs to full time jobs and so forth this week from jackson hole. you can take the market right back to its top, maybe close to 2000, maybe above it. but i think you have a tough autumn with investors worried about longer term growth. when we see growth being help moving about quicker normal interest rates than we've seen so far this year. >> all right. so, you know, i have to disagree. do we have any type of conflict at all, i have to provide all the dissenting opinions here. we have to think about that when we call you guys. we need david tyce on for every interview. >> i could disagree with this. >> please, go ahead and disagree. >> no, i'm serious. >> we saw yesterday, they didn't -- what do you think of

the international paper said? >> that the real numbers are not -- >> and consumers? >> for this economy and everybody is more conscious about that. >> all the retailers, right? >> why? what's wrong with the consumer? >> just haven't seen as much of an uptick and the competition is fierce. >> why? >> why does that data point not make you skeptical about the argument that you've just made? >> well, there's more to the earnings on the s&p than just the retailers. and i have some degree of caution on -- >> but not just retailers. when you're thinking of boxes, not just -- >> i could point to other transportation, rail car data and international -- >> we're going to have a segment on in the 7:00 hour about transport this morning. >> yeah, good. we've got to run anyway. thanks, jim. thanks, david. looking at the paper this morning, you know, when the president does something that frustrates his own party, i

always like him. this is when i go, you know, i like him. do you see this? harry reid and mitch mcconnell. harry reid says we have to talk about this. and the president said, you know, harry, you and mitch work this out, okay? and he dismissed him completely and harry reid was seething for the rest of the meeting. you see? i like that. here are these two clowns bickering again. >> you like the leadership thing. >> it's like, look, what are you doing in the senate? who hired you? didn't the people hire you? i have iraq on my plate, i've got putin on my plate. handle it. so that i liked, that he's frustrating -- >> he's not frustrating me. >> he's frut frustrating his own party i'm saying. and when he frustrates his own party, that's when i like him. >> according to that article. i think there's an economic

piece to that that we're not thinking about. i want to talk about that with you. coming up, though, the most honest city in america find out if your home makes the cut. plus, how one of the biggest hospital groups appears to have fallen victim to chinese hackers. "squawk box" returns with that and a lot more in just a moment.

long time saturday night live announcer do know don pardo has died at 96. a hell of a number. >> we should all make that a goal. >> if we make it there, we may never die. he was the voice of news cast game shows and tv programs for more than 60 years. jimmy fallon once said in his words, nothing is like the moment when don pardo says your name. we have a guy here that has a distinctive voice, too, that does all of our stuff. fought, obviously, with the same cache orr -- >> don pardo. let's talk about a different topic this morning. how honest on your neighbors? joe? conducting an experiment that it calls a national honesty index here. people in 60 locations in 50 states were offered an honor

system street rack for honesty. the company measured weather people paid $1 for the drink. 95% of people did. the most honest city -- do you want to guess? >> honolulu. >> you were looking in the te teleprom teleprompter. >> of course. >> for the second year in a row, 100% paid, apparently. d.c. was the most improved. its honesty went up 96% from last year's rating. and the most dishonest state, providence, rhode island. >> no comment. i didn't think new york would be high on the -- >> providence. >> providence. >> no. >> given that politicians -- what about jersey? newark. jersey would be 100%.

the home of big ben more than double the investment deals than new york. london the said to be better connected for air travel and has a time zone advantage over new york for doing business with asia. >> i think we should work on that time zone thing. maybe we should try to get the politicians to pause. so just to change that, just to make it better for dealing with -- >> it is true, by the way. >> that's going to be hard to do, i think. >> we could to do our show in london in the afternoons. >> i didn't like it when we did that in davos. then you get done and it's like 4:00. it's like, wait a second, i've just worked eight hours. in political news, the clintons are headed to iowa. it's hillary clinton's trip back

to the hawkeye state since her loss in the presidential campaign. it's the unofficial kickoff for the season, according to politico. >> i never thought any of that was running. >> turning up the camera is following them everywhere. >> did you see the latest, though? gotta have a g-450. nothing smaller. >> and -- >> you're happy for a bathroom in the lobby. she, it has to be the presidential suite when she goes to any of these places to give a speech. >> i saw the story. >> you didn't bring it up, though, and you don't look like you want to discuss it now. >> i'm happy to discuss it now. what do you think is the appropriate rate that she should charge? >> i don't know.

she already got in trouble for that. clinton will be a featured guest as retiring iowa senator tom harkins annual steak fry. i don't think you should fry a steak. community health system says it was a victim of a cyber attack from china. the hackers stole social security numbers and other personal data belonging to 4.5 million patients. security experts say the hacking group may have links to the chinese government. our friends. coming up, home depot shares getting a boost this morning. quarterly results beat the streets. same-store sales we're going to talk to an analyst next. as we head to break, here is a look at yesterday's winners & losers.

good morning. welcome back to "squawk box" here on cnbc. i'm joe kernen along with andrew ross sorkin. becky is off today. why are you laughing? luckily, i'm able to prevent certain things from happening around here. you know, i've got a new guy in charge who understands some of this stuff. we're up 28 points on the -- a

great day yesterday. >> especially if you were playing the nasdaq. 14 years later, march 2000? it's so high now. >> look around. this is the nasdaq 5,000 building. we thought we would be at 10,000 by the time we built this. comcast built this building finally. it is a beautiful structure. we moved to msnbc, but we have this beautiful building, but we were flush. those were flush days. and we're still not back to where we were. we're kidding when we call this the nasdaq 5000. but it's nice to be at 14-year highs. >> it is a thing about building stadiums and building at the top? >> i know. >> well, i know. it was a pretty good sale at that point. >> let's talk about building things this morning. shares of dow component home depot on the rise in premarket

trade hitting an all-time high. the home improvement retailer hitting shares 7 cents above estimates. revenue came in above expectations. home depot increasing its earnings forecast for the year. so a lot of good news after a strong rebound in the spring season failed. brian nagel, hard line analysts. good morning to you. help us through the -- your biggest surprise, let's say, for all of this. >> i think you summed it up pretty well. this is a really good quarter. the number that most investors will be looking at here initially will be the sales number. in the united states, a 6.4% comp that was on top of comparison last year. it shows this business rm did rebound as the weather improved. >> always trying to figure this out about home depot, is this a bellwether for the economy or should we take away something

away the this beyond the operations that are home depot or is it home depot specific? >> it's both. it's both. it's definitely just given the sheer size and given the sector, it's an economic component to their results. but i also think home depot, it's an interesting question. we look over the last couple of months, there were some negative preannouncements out of our smaller home-type companies. and then to hear home depot report today, they show very good results. that demonstrates how good of an operator home depot is. >> given that they beat estimates and they beat them handily, what did you miss? >> we were positive going into this report. they beat our estimate on the sales line. and home depot also, to their credit, controlled expenses better in the quarter than they expected. >> you have a 93 cents target when they change that? >> we'll see.

we're digging through the model right now. this remains one of our top picks in the retail sector. we'll see what -- >> if you had a buck to invest in home depot or a buck to invest in lowe's, is it clear to go to home depot. >> home depot is the better performing company, but lowe's -- we'll see lowe's results tomorrow. i think both companies are capitalizing on improving command in the sector. >> final question, the weather question. we talked about weather for the first half of the year almost. what is the lesson of what just happened here in terms of how we should seek through numbers, given weather situations like what we saw earlier this year? >> i think it's a reminder for everyone. it tells everyone to keep in mind this is a very weather dependent business. so when we have wild swings in the weather, keep that in mind when we're taking into consideration home depot results. coming up, it is definitely

the rory mcilroy period, really. the 25-year-old golfer is, you know, hitting 335 yard drives and making every putt. and all this before he even starts the fedex cup. he is sitting down with us.. ♪ ♪ developers are all about speeds and feeds. it's all about latency. it's all about how fast does it run. i often sit with enterprises who ask me about how mission critical and how's the performance of the cloud. and i tell them, if you can make gamers happy, you can make anybody happy. speed is made with the ibm cloud. the ibm cloud is the cloud for business.

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welcome back this morning. time now for the squawk planner. i like this squawk planner music at 8:30 eastern time, the july consumer price index, the headline number seen rising 0.1%. we're going to be getting last

month's housing starts examine building permits. starts expected to jump by more than 8%. and today marks ten years since google went public. we're going to talk more about the dutch auction and the stock's massive rise since then a bit later this morning. that is today's squawk planner. joe. if you are heading out to the pool, the beach or the golf club today, will you wear sunscreen? before you make your decision, listen to this story. this video has gone viral. a photographer modified his camera to record people in the ultraviolet spectrum. the video highlights speckles and sun damage. meantime, it shows that if you apply sunscreen, the camera's filter shows a white lotion looks like black war paint. it says here. but both of us know that -- i've had like three different kinds of weird things. >> you've got to wear the swim shirts and the spf-50 every day. >> did you see when liam nielson, what the tabloids do

when he has a small basal cell? he had a pre -- weird neevus or something. we are -- compared to liam niecen -- >> neevus is an island. >> to you. what do they call that, and they clear up margins and everything. but we should be -- all be very careful. >> i'm not complaining. b basal cell or something like that and it's from me not paying enough attention to my skin. >> it is about the kids. >> have you seen my kids? covered. my gingers, they can't -- no. we've got to -- immediately, even if they're going to be out at all, we invest so much money in sunscreen, in spray sunscreen. but then, you know, for us, i

don't know, someone yesterday said you look better pale. do you remember that? who said that. >> i definitely look awful, you know, pasty faced. i look better with a tan. i think you look good either way. >> ghost right here. who was that? >> it's not bad to look good pale. you know, i think it's okay. >> i wish i could look good pale. coming up, squawk sports news. the ace of williamsport, she's in a league of her own. she throws heat. she lights up the little league world series again. the buzz that she's bringing to baseball after the break. plus, rorying ahead. rorying ahead. that's the latest one-name golfing great have what it takes to lead the pga in the golf funk? stick around to find out. "squawk box" will be right back.

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tiger woods and rory mcilroy teaming up to introduce nike's latest golf clubs. they're here in new york to talk about the state of the industry. david chu got to sit down with 25-year-old rory mcilroy. he joins us now partnership admire tiger, i always have -- >> we all do. >> but to hang with rory, i don't want to say it's a passing of a baton, but sometimes i fear it kind of is. >> the reason i would say it's not a passing of a baton, they were both at this nike event for their new irons last night. tiger did not hit any shots. why? because he's still injured. but rory hit with ease and he

dazzled the audience with how will he could strike a ball without any effort whatsoever. but it speaks to the idea that there is this idea that maybe golf needs a new lightning rod. somebody who can get out there and -- >> jack won a tournament at 45 or 46. watson almost won a tournament up in his major, right? i mean a major. i didn't mean -- miller won a tournament, he won pebble beach. but the way tiger and these guys swing now, tiger is 50% older than rory. >> that's right. and you've got knees, back. you've got back and you've got, as we know, the small neshs involved with putting on the six and seven-footers. rory putting on six and seven-footers, tiger does not putt like that any more. >> i have to imagine that tiger is going to be around for a long time. >> do you think he will win more majors? >> i think he will. i throughoutly think he will. >> did you have a better chance

of beatinging paul trekker? >> he has -- >> the last four could be bigger than rory's next ten. here is the thing. take that thought, right? and that is what may save the game of golf. golf has been in this second ewe layer state of decline. >> here is the interesting part. we spoke to rory and mikey golf president cindy davis about this last night about the idea that with golf, maybe there is a chance that golf is going to be around for a while and its demise, like you said, joe, has been grossly overstated. take a listen to what they told us. >> people that are playing the games, the numbers are slightly down. whether that's just because of demands of the modern world, modern life, people not having as much time to play ten holes of golf. but you look at, you know, viewership numbers in golf are, you know, staying steady or are on the rise. so, you know, people are still

interested in golf. people still want to be involved with golf. as i said, people might not necessarily have the time to play, you know, 18 holes any more, but, you know, if we brought some sort of shortened version to the game to them, they can still play nine holes. golf is a great game. it's a game that i still think people that want to be involved with. and so i feel like i have some sort of responsibility. and some way, yes, i feel especially kids can be inspired by not just what i do on the course, but i was inspired by tiger woods. and these young kids coming up might be inspired by me or by yordan spieth, some of the young guys coming up. so we have some responsibility in trying to bring the younger generation into the game. i still feel like, you know, the game of golf will survive. >> now, cindy, for you, as a golf executive, you have an intp interesting view on the economy. golf is probably one of the most discretionary spending items for anybody out there.

from your standpoint as a golfing executive, what do you think it's telling you about the state of the overall economy, not just in the u.s., but around the world? >> well, we've always noted that where there's a growing of the world where there is a growing middle class. and we're there and we're part of that from a golf standpoint. i think, though, as we go through this transition with golf, i think it's important to remember, this is a sport that's been around for centuries. and it has always endured, there's always been golf and an opportunity. >> we're all old enough to remember the old ad campaign from nike, right? the charles barkley one. i am not a role model. >> yep, i remember that. >> remember that one? the poster and everything else. i am not a role model. rory mcilroy is refreshing because he's embraced this idea that he is a role model and he's baring the mantel now for a lot of young golfers out there which is a good thing for the game of golf overall and that's maybe one of the reasons why you'll see golf perhaps catch a bit of an upswing in the next coming

year. >> worked for charles, though. i've seen him, you know, i've seen him lose $500,000 in lake tahoe at a gambling table. yet i've seen him say things so right on without worrying about the consequences. so i love him, too. you're here. >> i'm here. >> stick around, dom. >> dave briggs is here. >> dave briggs anchor with nbc sports. like all sports guys you are willing to hype the hell out of a story that golf is dead. that's just what you do. >> it has not been greatly -- >> you wear ridiculous outfits. you wear, you know, you've seen what -- you who is that guy? who is that guy at the tennis tournaments that wears those ridiculous jackets? all you sports guys got to make a statement. golf takes five hours. people are on social media now. it's different but it's never going to just go away. >> i'm not saying it's going to die. 18 to 30 rules are down 35% in ten years. the golf course closes every 48 hours in this country. it's dying. >> we've got to overbill. >> the tiger bubble --

>> it's not instant gratification like playing brick breaker or what's that bird thing? >> angry birds. >> it's hard. >> that's the issue. >> sometimes it's good that things are hard. >> should be nine holes. >> you should learn that sometimes things are hard. >> look at the retail industry. the golf -- golf is getting crushed down double digits the last three years. >> they said it. >> dick's let go all their golf pros, 500 of them. it's not greatly exaggerated. >> oh, yes it is. >> things cycle. they ebb and flow. i mean, the satisfaction -- i mean you're talking to someone who really does think at times why am i still out here spoiling a good walk. because some days we feel great. don't we feel like you know i really got this. other days it's like, i'm never going to get any good. >> most days -- >> but, but the satisfaction of, you know, when you actually do play a little, and then get a little bit better. >> there's nothing like it but i

don't think the young kids want to -- >> and i don't think they're ever going back. >> i don't believe that, though. >> correct me -- >> you're like the pope talking about birth control or sex. you don't play golf, you don't know anything about it. >> i play golf -- >> i've seen you swing. it's not really a golf -- you didn't start -- >> that is correct. i started too late. >> not a golfer. >> he's a golfer. he's a single digit handicap golfer. >> but golf was not cool when i started playing the game. >> it will never be cool. it's going to be craig statler is our athlete. >> give people four hours -- where are people going to find four or five hours -- >> and it's expensive. it grows on you. i will say i fought my mom and dad tooth and nail about not playing the game of golf. my dad got me out there, we hit the range every day, we took lessons and all of a sudden now, i've just found like it's this zen thing that i can do. >> can i make a different argument? i'm going to make an urban versus suburban argument. >> okay. >> which is -- and we've had people come on the show over and over say more and more people move to cities and are leaving suburbia.

the more and more people move to cities the harder it is to actually play golf. >> it's very difficult. the accessibility is terrible. >> we're all in the new york area. what about technology being able to bridge that gap? because if you go to places like golf and body in new york city, and you know that, urban golf centers can prap because -- >> pro golf -- >> and that's another trend that's greatly exaggerated, too. not everyone is going to move back in the city. i'm never moving back -- i may some day try and have a second place there or something. but i'm never moving. so you know, you like it. you get the food delivered to you. and you know, people -- what's the other advantage? you know, having dog poop everywhere you walk, is that good? or a guy with an ice pick around every corner. >> you don't have to, but they are. >> oh, really? the rest of the country is moving to cities. really? >> 23 you look at the overall demographic trends in america. this is what's happening. >> you and i talked on twitter -- >> and the american dream is dead and everything is different than it ever was before and it's late evening in america, it's not morning.

>> it is always morning in america. >> we talked about the television ratings for the pga. they were up 35%. but the prior three majors were historic lows. 30, 40, 50 year lows. >> martin kaymer, you want to watch him even when he's not ahead by eight strokes. >> that's my point if you don't have worre -- rory, rickie and phil you're going to struggle -- >> and rory won the open this year, too. right, didn't he? >> rory's prior three major wins were double digit television declines. >> that's because he was ahead by double digits on a couple of those. that is not good. >> that's the -- >> it's got to be a match. it can't be someone ahead by eight strokes. >> it's not just every match. it's got to be the old and the new. it's got to be phil mickelson and rickie -- >> the last pga that was the high, right? that we're coming from. was 2009. that was the year -- >> tiger and hawaii -- >> yeah. came back from two strokes to beat tiger.

>> it's a good story. >> i was talk -- there's an expression, when you hit 5 iron the way you should, like a tuning fork -- >> in your soul. >> it's like a tuning fork in your soul. >> it's like a tuning fork going off in your soul. >> you can say in your pants. >> anyway. talk about mo'ne. >> not just playing with boys but a 13-year-old who stloes a 70-mile-per-hour fastball. she is dominating the boys. the first shutout in little league world series history in 67 years. 32,000 fans showed up for the sunday night game. she didn't even pitch. that's more than 8 major league teams do on sunday. >> what is her facebook? >> 70. about ten miles an hour faster on average -- >> i can throw as hard as i can and it's like 48. >> she'll pitch wednesday against vegas and you'll probably see television ratings bigger than major league baseball. >> dave briggs thanks for joining us. the street's reaction to home depot's quarterly ruts. we're going to talk about what those numbers mean and a lot more in just a moment.

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the summer of stocks. momentum, the name of the game. we have the biggest winners and losers. raising the roof on housing. dow component home depot posting better than expected quarterly results and giving a unique take on the real estate market. >> google, the date, august 19th, 2004. that's when the search giant went public, ten years later the company still dominating the world. >> "squawk box" starts right now. >> that was, of course, rory mcilroy. i often wonder whether kenny

loggins is glad that he allowed this to be part of -- you think it's a good thing or a bad thing? >> i actually saw kenny loggins live a couple weeks ago. >> people see him and can't think of anything but caddyshack. >> he was amazing. amazing show. >> where was -- >> just kenny loggins. >> kicking off "squawk box" this hour. he's in town for the start of the barclays -- is that why you're here? >> for what the barclays? >> we're talking about rory mcilroy not gary kaminsky. >> good morning, joe. >> i love the beard. >> dominic chu caught up with rory last night. a lot more of that conversation a bit later in the hour. he also appeared on the tonight show with jimmy fallon and with him another face familiar to golf fans. >> tiger, you're going to be my coach. >> i'm just getting the balls lined up for you, sir. >> i appreciate it. i love that you're my caddie. this is the best thing ever. >> our guest host this morning, morgan stanley wealth management vice chairman gary kaminsky.

>> also known as joe's caddie. >> you have not -- >> no -- >> you're not part of the problem. because you can't quit the game so you never did play. >> i did play one time out in pebble beach, and -- >> oh, that's a good place to start on pebble. >> i went to golf camp but i just don't have the patience. to play. >> it's hard. it takes a lot of work. >> you should start on -- >> you should start from the back tees. anyway futures right now let's take a quick look. they have been indicated higher for most of the session. and then the ten-year, take a quick look at that which is 2.37 confounding everyone. >> wait a minute. somebody called that. >> have you ever been really get friendly to the stock market though, gary? >> very friendly to the stock market? >> yes, did you ever in the last -- >> absolutely. absolutely. absolutely, joe. >> what about now?

>> you want to talk about the market already, right now? >> yes, i want to know just real quickly, is it -- is it exuberant, is it irrational, is it too high? does it need to pull back? is it overpriced? is it overvalued? would you stay long? would you buy today? those are eight questions. >> very simple, i think that the typical normalized asset allocation which is to have some fixed income and to have some equities for the great bulk of people continues to make sense. it's what i've said for the last several years. i don't necessarily like where market is going up. i don't necessarily think it makes a lot of sense. >> why is it the fed you mean? is that what you're implying? >> it's central banks around the world. that's what it's been basically driving the great bulk of equity moves. however i don't think that's going to change. as a result of that, what i've told people, what i've told our clients and advisers for the last six months is you might not like the way it smells, the way it looks or the way it feels but this is what you need to do in terms of investing asset allocation and that doesn't change. >> you can do the one-year or you can do the ten-year german bund for 1% or double your

return in a u.s. treasury for 2.3%. for ten years. so the stock market, as long as that's de facto where savers are, you probably are going to put people -- push people out the risk curve which is what the fed has been intending to do all along, and makes sense to stay there. out the risk curve. junk bonds. >> as simple as it sounds, sometimes we try to complicate things. >> it's that simple? >> you and i have been around to watch enough markets, you know, thinking back to the google ten-year or the 20-year tech bubble. when they said whoever came up with the phrase don't fight the fed and in this case obviously the central banks around the world, you don't have to make things more complicated than that. >> okay. >> the central banks have told you where they want to put -- where they want people to put assets. and as a result of that, i don't see anything that's going to change as a result of 459. the one thing that i differ from most, and i have differed from most is that i continue to believe fixed income plays an important role in a portfolio. there has not been a bond

bubble. i don't believe there's a bond bubble. all the evidence i see continues to point that interest rates are going to stay low and remain low, whether it's post taper, in the taper, or whatever we have there. >> we have a lot of time for you later. >> we do. >> i like that green tie, too. >> thank you very much. >> you wore green so you could hide from me. >> courtney said she liked it. >> i do like it. >> okay? >> that's a caddyshack look. that's why i said that. i don't just look at you and say you wore glean so you could hide from me. >> let's talk headlines. by the way, we're both purple today. >> is this purple? where? >> what color is that? >> is it purple? i don't know. >> it's -- purple. >> dow component home depot, it's one of the day's early winners after beating estimates with its second quarter earnings and revenue. the home improvement retailer raised its earnings forecast for the year. joining us cnbc retail reporter courtney reagan. >> retail itself may be in a funk but the home improvement retailers seem to be the exception. home depot posting stronger than expected quarter nearly on all

fronts beating earnings estimates by seven cents 1.52 on 23.811 billion in revenue. that top line also better than consensus. u.s. same-store sales gaining 6.4% higher than the 4.9% expected. upping the full year guidance by ten cents to 4.52 that's eleven cents above where the street is expecting it to come in. it was a solid quarter straight through for the world's largest retailer. ceo frank blake says home depot saw its spring seasonal business rebound as well as strong performance in the core of the store and across all geographies. credit suisse says cooperative weather, pentup demand for home depair and market share donated from sears in the nonappliance categories both helping home depot's results transactions and average ticket up 4.2 and 1.8%. respectively but the retail earnings parade does not end with home depot. analysts looking for dick's sporting goods to report earnings of 65 cents per share on revenues of 1.65. $3 billion same stor sales

growing 1.1%. remember last quarter the retailer noted golf and hunting were weak. we'll see if those areas have picked up. i don't know if you were listening to the earlier conversation. tjx looking for 73 cents on revenue of 6.884 billion and same-store sales gain of 2.4%. tjx has long been a standout. as the internet begins to gain strength and just ramping up their operations they're losing just a touch to some other players. >> thanks, courtney. other retailer home depot is going to be a big winner today. among the other best performance stocks this summer, biotech. be careful, though, janet yellen put a sell out on biotech. meg tirrell joins us with that story. >> they have done well. it's really the big guys that are doing well. we're seeing celgene, amgen hitting all-time highs yesterday. and analysts tell me that's because the second quarter was really good. these are all driven both by earnings but also about excitement about their

pipelines. cellgene has got a big drug that's a blood cancer drug. it's tapped into the smaller biotechs through business development and partnerships. a lot of folks are really excited about that. amgen just did a restructuring, cut a lot of jobs. folks are excited about their emerging pipeline. they have a drug that targets cholesterol. gilead of course has that huge hepatitis-c drug. estimated to bring in $12 billion to $13 billion in its first year on the market. a lot of folks excited about that. they'll be bringing in a lot of cash. expected to do a lot of acquisitions. and rejeneron. they have long-term growth in a cholesterol drug sets up a space race over cholesterol between amgen, and you mentioned yellen's comments earlier. analysts are staying some of those fears might be waning a little bit. there was also some concern -- >> there were fears from janet

yellen a real fear in the market? >> some of the concerns she was saying it was overheated causing a little bit of a sell-off but then there was also a letter that congressman waxman had sent to gilead over its pricing so there were fears about that in march as well so what rbc's michael yee saying that might be waning. >> pretty funny, gary, that as the fed goes some of these stocks seem to be getting a little ahead of themselves. we don't understand why. bit, i mean they may have had a little bit to do with some of these stretch valuations, don't you think? >> yes, yes indeed. and it was probably some staffer who actually wrote that line -- >> it was sort of a cya line in case something does happen. >> again, it was, when did greenspan say the irrational exuberance. >> i think we were at about 5,000 on the dow. 6,000. we doubled there. >> the nasdaq doubled after he said irrational exuberance. the fed speech writers put these kind of things in there as you

say cya. >> i'm not sure what that means. >> the late great marty situation came over with the original phrase don't fight the fed. >> biotech one of many sectors taking investors on a wild ride. check out major moves so far this month. big winners like linkedin, tesla and trex. and big losers like seaworld, noodles, and nuskin. gary, let me just -- no, let me just get ready. because -- >> you know what i really like? >> should investors expect these mood swings to continue or is this just a by-product of the summer trading volume? >> interview. let me read it, too. when did we start doing this again? let me -- is this you? is it really? >> yeah. >> all right. >> read it. >> really works good for me. let me read it again since i can't think of my own questions. let's go back down. gary, should investors expect -- and then you're going to read

it. should investors expect these mood swings to continue -- or is this just a by-product of the thin summer trading volume? this is going well. >> okay. when you look at the august gainers and losers, i actually think you asked earlier about signs of a normal market, healthy market, i think it's a healthy market. look at the decliners. each one of them has a fundamental reason. it's not the closet index taking down a bunch of the lowest -- >> you want to talk as someone who is going to listen? i'm sheer. >> joe is typing something. he's saying don't -- >> so when you look at that, in fact, guys i think it's a sign of a very healthy market. i actually pulled a couple of full screens in line with this because i also knew what the question was and that you know, i was -- nick carl at convergence does a lot of great stuff thinking outside the box and looking at sentiment, things like those stocks that are down and this to me was really

interesting late july, he looks at the google searches, and i always used to reference this. interest in traditional financial assets, stocks, bonds, mutual funds is down 19% in terms of initial google searches since 2006. when the capital markets reached the new highs leading up to the last market crash searchers were led to traditional assets. searches were up 61%. subsequent to the peak of october 2008 these searches fell by 45%. ie you want to know, you're always asking the question, is the public obsessed or is the public too invested. now conversely, look at interest in human capital. ie schooling learning languages getting involved in start-ups is up 359% since 2006. prefinancial crisis interest related to investing in one's self was virtually flat down 3%. post financial crisis by 33%. so when you want to know are we

in irrational exuberance and you look at this type of data -- >> you think the google search is actually the index for you? >> well if you looked at previous google searches in terms of when people were hearing about things and looking at things, it's a good indication of what the public is thinking. much more than what are the biggest gainers and losers -- >> let me ask you completely different question. >> yes, sir. >> this is a wealth management question. >> mm-hmm. >> pretend i am a client, i come to you right now, i say look, gary, i got some dough over here. >> right. >> i want you to do something with it. should you put my money in hedge funds today? and the reason i ask is that the equity market has so outperformed the hedge fund world over the past 12 months maybe even the past 24 months even more like the past 12 months that it's out rangeious and i think there are people with money who watch our show saying something's got to give here. >> that's a good question and the first question i would ask you or one of my advisers would ask you is what's your time horizon on the money.

can't just say i want to invest the money. >> okay let's say i have 5, 10, 20 -- play for the long-term. >> and so the answer to that would be that the belief is that a certain portion of a pool of assets should be in alternatives. you used the word hedge funds. alternatives is not just hedge funds. it's private equity. it's not -- and hedge funds doesn't just mean long short equity hedge funds. there's a number of things in credit area. number of things in -- >> you would argue that most alternatives have not performed well on a relative basis at least to the equity market. >> it depends what it is. the s&p 500. if you're looking at a relative basis of the hedge fund versus the s&p 500, you're correct. if you're looking at a bench mark such as overnight libor times two plus two, sort of an absolute return bench mark, there's a great bulk of alternative assets beating that. it depends on what your bench mark is against. >> one quick question you think we're going to have sort of a september swoon? there's a lot of people sitting around with cash thinking that

something is about to happen and they haven't gone in waiting for this moment? >> i don't -- i continue to believe that the path we've been on for the first eight months of the year continues. but again i'm not a great market timer in terms of the short term. >> your whole thing a lot of times is just -- all that stuff. you've been saying. you've been beating that -- >> closet indexer. >> yes. >> for 15 years. >> well, because, joe why would anybody want to give money to an active manager pay them 1%, 1.25% and that was even in the pre-etf world when you could guy the vanguard -- now you can buy a whole package of etfs if you're going to have somebody who is actively managing money but basically hugging the bench mark. >> this is a way you were always able to generate value and worth forewhat you did at newburgher berman. >> correct. >> we also -- >> the performance. >> there was i ten year period the s&p return was zero and we had an annualize compounded return of 10%. that was by thinking outside of the box and stocks -- related to

the index. >> most famous stock in the world for you. >> was that sun corps. >> sun corp. >> been great. >> one more stock to watch andrew. >> and this one is not on the winner's list this morning. shares of mining giant bhp billiton just announced plans to spin off $16 billion of assets to shareholders in a separate publicly traded company. investors were disappointed when the company did not announce an expected stock buyback. coming up planes, trains and automobiles. the story of the transports and what they tell us about the economy, and the broader markets. then later is this country's job market finally bouncing back? and more importantly are the positions being created good ones? a passionate debate. that will be -- totally un -- unprepared or unplanned. we'll begin at 7:30 eastern.

the transports coming off their best day since may and overall it's been a great year for trains, planes and yes automobiles. the dow transports up more than 13% while the dow industries only higher by about 1.5% year-to-date. let's bring in jason subtle from cowen & company, he covers air freight and surface transportation stocks. good morning to you. help us through this. so we had the ceo of international paper on yesterday.

he would tell, based on boxes, corrugated cardboard, that the economy not actually in great shape. that it's only sort of, he's sort of seeing a 1% world, and yet, the guys are transporting all of their boxes ostensibly doing much, much better. >> to me transports are a good indicator of the economy. you don't see the economy go up or down unless my guys see what's happening. when you take a look at train traffic and you dissect it the economy is doing pretty well. right now quarter to date in q3 we're up about 6.5%. if you remove ag, and coal, which is not really economically sensitive, we're up over 7%. so if you look at the -- >> what are they transporting? because the guy who is making the boxes, which i would have thought -- >> everything. they're transporting everything right now. if you break it down even further and look at the air modal piece and say, all right, let's say three quarters of the growth is due to people preshipping because of fears of

the west coast port strike and some of that might be a little bit of leakage from the tight truck capacity out there you're still looking at growth of about 5%. historical rail traffic, like that, is usually gdp plus or minus a percent so we're doing pretty well right now. if you look at the supply chain in transportation, it's tight. it's tight in rails, it's tight in trucks. and that tightness is leaving the one thing. prices going up for all carriers. >> maybe their transporting lumber. >> have you figured this out with home depot yet? how do you do 6%? and it's not the first quarter. it's year over year. what changed at home depot in the last 12 months? that's the best retailer number we've had. >> that's what i'm trying to -- is it -- >> i was going to ask you, part of what's happening is that because of 2008, 2009, clearly in the airline industry there hasn't been capacity growth. if you look at typical economic recoveries, and new trucks or new rail cars that are put into

action, or put into the system, is that part of what's happening? >> well, i think capacity is clearly constrained right now. if you look on the trucking side, for instance, it's not the new truck bills the issue it's getting the drivers into the truck. a new trucking asset is $120,000 -- >> not enough drivers? >> not enough drivers. i've been in transportation 21 years. there's never been a good year for drivers. but this has been the worst year. if you go back last year the government instituted some regulations that made it tougher to become a driver. so these guys are on, you know, the drivers on the road three weeks at a time, making about $50,000 a year. you know, it's just not a real pull for people to come in and be a truck driver. that's what we've seen now. >> jason help us with one thing before we let you go. mergers and acquisitions. i understand you have a view that we're going to see a lot of consolidation come perhaps even as early as this fall. who's going to merge, why? what's driving it? >> sure. now we wrote our piece i think

back in april, and you know, if you saw what happened in q2 there was a lot of movement in transportation, we've seen trucking, m&a, we've seen logistic m&a. you'll see continued logistics transactions. i think we could even see continued trucking and maybe even a shortline railroad transaction. >> you play the game with us and just throw out a couple names? >> sure, i think people to participate in the m&a world are going to be likes like genesee in wyoming, gwr, i think -- >> as a seller? >> tease are guys that are going to be buyers. >> you want the sellers? >> the sellers? i think on the private side. that's what we've seen a lot right now. most of these are private transactions but fairly large. hundreds of millions of dollars. >> thank you for joining us this morning. >> my pleasure. >> doesn't float your boat. >> excuse me? >> that doesn't float your boat. >> no i want public m&a. that's how you play. >> that's not what andrew -- he wants bigger in public. coming up a 1200 acre wildfire burns just a few miles from the

entrance to yosemite national park in california. we'll have an update. and then, the google guys are in the top 20 billionaires of the world. but ten years after the search giant went public they're not alone. we'll have a look at who else has cashed in big on the famed dutch auction when "squawk box" returns. your 16-year-old daughter studied day and night for her driver's test. secretly inside, you hoped she wouldn't pass. the thought of your baby girl driving around all by herself was... you just weren't ready. but she did pass. 'cause she's your baby girl. and now you're proud. a bundle of nerves proud. but proud. get a discount when you add a newly-licensed teen to your liberty mutual insurance policy.

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who don't have electricity 400 million people and i just figured that it's time i do something about it. what we're doing right now, along with ibm, is to actually transfer data through a satellite from our wind farms directly onto the cloud. i think we could create a far more efficient system across the whole network where we could actually draw down different kinds of energy based on when it's needed by the consumer. a smarter energy system is made with the ibm cloud. the ibm cloud is the cloud for business.

coming up, call it the jobs recovery. why some say hiring is finally picking up and high paying industries. plus, before there was buzz about an ipo of facebook or twitter, there of course was google. ten years ago today, the search giant went public in heavily hyped dutch auction. we're going to talk to the investment banker behind it and ask why the internet based auction never took off with other companies. when i'm working, things can get so hectic. so sometimes i need to find an easy way to express what's most important to me. like, with my crew, i use shorthand to talk to them and tell them what i need... and when i need to talk directly to my fans... but the most meaningful shorthand of all is the one i use when i'm about to drive: "#x." it's an easy way to tell everyone that i'm about to drive. and i do it every time before i get behind the wheel. use #x to pause the conversation before you drive. because no text is worth a life e

financial noise financial noise financial noise financial noise

welcome back to "squawk box" this morning. home depot getting a boost this morning. the dow component's earnings and revenue beating the street handily. the home improvement retailer also raised its earnings forecast for the year. and also, no bieber fever at elizabeth arden. the company posting a bigger than expected loss, revenues also missed the mark. among the reasons, steeper than expected drops in celebrity fragrances. >> no idea what you're talking about. >> particularly justin bieber and taylor swift. >> who in the world would wear

and want to smell like justin bieber. >> there are probably not enough people want to smell -- >> is there one? >> part of the problem. >> is there a single person in the world who wants to smell like justin bieber? what does he smell like? well, that's a totally different matter, isn't it? i mean i don't want to smell like -- young ladies might like to. >> maybe some young guys want to smell like bieber. >> what does he smell like? >> hot. i don't know. i don't know. >> all right. you okay -- maybe you're on to something there. all right. >> let's tell you about some other stories going on around the country. 1200 acre fire is burning in central california, and is forcing evacuations today. the fire is just a few miles from the entrance to yosemite national park. people in some 13,000 homes and businesses have now been told to leave because of the fire remains under investigation. better paying jobs staging a comeback after being concentrated in fields with low wages this according to the

national employment law project. yesterday, we spoke to cke restaurant ceo andrew puzder, that's carl's junior, and asked him if he's seeing that same type of growth. >> now we're in a position again where we're not seeing the kind of growth we should be seeing. we're not seeing the kind of job creation we should be seeing. >> and joining us now jared bernstein, love this man, board member of the national employment law project, former chief economist for vice president biden. at this point, jared, you do or do not have a fragrance marketed under -- >> i do have a -- >> is it called jared? >> next time we get to the, i'll allow you to smell me. and then you'll know my fragrance. >> i always thought you smelled pretty good just whatever that is. >> thank you. >> natural pheromone or whatever. >> right back at you. >> a lot of your arguments stink. but jared, you know what? i immediately thought about this, and it's great. and you're trying to be happy about it. i can see that. that some of the jobs are

better. but when we had alan krueger on, remember what his work did, what his work showed, that there wasn't as much slack, therefore the fed might need to be a little bit more wary of what they're doing? he -- he acknowledged that he had gotten some pushback from the administration where he used to work. because that's the last thing they want to hear, is that the fed can relax and not -- >> no, no, no. >> -- and i think you're looking at this half empty -- you should be saying how great this is, but the first thing you say is, yeah, that the jobs are better but the fed -- >> if you give me a chance i'll tell you what i want to say about it. >> go ahead. >> thank you. the report suggests that there are sectors of the economy that are doing a bit better on the wage side, and i'm sure that's true. but tilely, there's still considerable slack in the job market, and there's not very much wage pressure across the board. i actually think it's valuable to look at the broader picture in this regard, both in terms of the federal reserve, which we mentioned earlier, obviously chair yellen's been talking

about the absence of wage pressure as an important criteria to keep the monetary stimulus going. but also at the microlevel. because while you can find some improvements at the margin, remember, there's, you know, 100-plus million people drawing paychecks and many of them have been flat for years now. now, we talk a lot about financial markets on this show, as we should. but most people get by based on their paychecks, not their stock portfolio, and they're still facing some slack, so i disagree with alan on that point. >> so you really do. but i think there are certain interesting things, we got some people writing in about trucking jobs. we were just talking about transport jobs, we got guys writing in that you can do not overnight, and you can get 70, 80 grand, there's plenty of jobs available, and that people just, they're not taking them. so there are -- there are certain industries where there is no slack, and they are actually looking for people -- >> well, actually, i would challenge that view on trucking based on some recent research i read that suggested wages there, again, they're starting to tail

up at the most recently, but they're still in real terms 5% or 6% behind -- >> would you like wages to trend up in the private sector naturally? or do you just love government minimum wage hikes so much that you'd just rather have the government set wages? what would your preference be? >> look, at the low end i think it's widely agreed upon that we need a minimum wage -- >> you'd rather have the government legislate the higher wages. >> that won't -- but that won't change the average picture or even the median picture at all. it's a relatively small group at the bottom. i would much rather have tight labor markets, full employment, create the wage pressure. that's the only way we've ever seen wage pressure in the last 20 years -- >> although, it isn't great when the labor market gets too tight. where you have the worries about inflation and wage pricing. >> that is -- that is a high class project. >> long way off. >> you want to ask -- >> i was just going to say, jared, you know there's a correlation between the industries that have been most

positively impacted by quantitative easing in terms of what wage growth has looked like there. >> yes. >> so clearly the industry's high-end real estate, high-end retail that have benefited from the stock market gains and the quantitative easing have seen the wage growth. what does that tell you in terms of, in a post qe world? >> you know, it's not just qe. i think it's an interesting point. the financial services generally have done better all the way from profits down to wages. and i do think it has a lot to do with the structure of the economy. the kind of industries that have been doing better. i will remind you, you mentioned quantitative easing. there was also obviously a very significant bailout. so there's really a linkage between government activity and areas of the economy that are doing better. >> so your point would be that because the government was in favor of quantitative easing, that more government programs would impact the overall wage growth for the entire economy? >> well, more -- somewhat. more nuanced than the following sense. when the market fails, as it did

so dramatically in finance back in 2007, 2008, there's an obvious role for government to step in and temporarily try to make a difference. and where we did this, we had some success. where i think we've really missed is in the rest of the economy. that is there hasn't been enough activity to squeeze -- help squeeze the slack out of the rest of the job market. it shouldn't be that just the finance sector is doing well. i mean, that's actually a relatively small sector. we need to see retail doing better. not just on the profit side but on the wage side, as well. we need to see construction, manufacturing, health care. there is some employment being created there but there still is wage stagnation. >> are we going to do any positive things in the next two years in your view just through executive action, is that the only game in town? as far as you're concerned? >> it is definitely the only game in town in terms of -- i wouldn't even call it legislation, because it's not

legislation. in terms of, you know, making new rules, or executive kinds of changes. but i will say this for congress. if you actually look at the macro economy, congress has evolved from really whacking the heck out of economic growth, with this austerity, and you know, fiscal drag, to the point where they're now kind of a do no harm congress. in the sense that they're really not taking much off of gdp growth due to fiscal policy relative to earlier years. fiscal impulse has been neutral, not negative. and do no harm is the best you can hope for. >> would you be as someone that, you know, if he does criticize the president, usually from the left, would you be angry if the president walked across the street to congress and said you know what? i've decided that the tax reform is something that i think can help, and i'm going to get it started. may not happen in my administration -- >> angry? i would pop a champagne cork on

that one. i mean i think that the -- >> have you suggested it? i mean, you're widely respected. as far as you know. >> yeah, i'm not -- i'm not sure of the sway i have in that regard. but, look, i think that the -- by the way, speaking of tax reform, there's a guy sitting at that table who wrote a really great piece today in "the new york times." >> kaminsky? >> no, his name is andrew sorkin. i'm sure kaminsky could do it if he wanted to. but sorkin actually did it. >> thank you. >> where is this? >> in "the new york times." >> it's in "the new york times" today. >> let me check it out. >> it's a great piece. so i think what -- let me tell you what andrew said. >> 90% marginal rate makes things went well under eisenhower is that -- >> it is not just the president walking across the aisle and saying -- >> -- tax reform i didn't even need to read it. >> head line grabs you right there. >> not as heavy as it looks. >> thank you, mr. bernstein. >> it was going to --

>> corporate apologists -- >> as andrew -- as andrew's piece shows you it's going to take more than any politician including the president wanting to start tax reform, because you see, in tax reform, some people end up worse off, some people end up better off, and those who end up worse off will block your efforts. so it's not as simple as it sounds. >> right, andrew? >> thank you, mr. bernstein. >> kleinbar professor at the havana school of -- oh, no, no, goulds -- i'm sorry, goulds school of law. anyway, what is this, andrew? what's your premise that -- >> the premise is -- >> how did you get it in this paper? how did they publish this? how did you get them to do this? >> andrew has been making a ton of sense on the inversion issue. >> thank you. >> you know what? >> listen to andrew on that point. >> you guys are basically soul mates on that issue. we have. >> we talked a lot about inversions. i didn't want to raise your blood pressure too much there. we'll see you in a little bit. coming up the world's most

popular search engine turned tech behemoth celebrating ten years as a publicly traded company. >> what? >> behemoth. robert frank takes a look at who's made billions from google. take a look at this in 2004 revenues were about 3.2 billion dollars. today, 63 billion dollar profits. now, 13.6 billion. google employs more than 52,000 people just ten years ago, only had 3,000 workers. and then there's rory mcilroy on keeping golf alive. "squawk box" is back in just a bit. so i can reach ally bank 24/7, but there are no branches? 24/7 it's just i'm a little reluctant to try new things. what's wrong with trying new things? feel that in your muscles? yeah... i do... try a new way to bank, where no branches equals great rates. i take prilosec otc each morning for my frequent heartburn. because it gives me zero heartburn...

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welcome back to "squawk box." futures now up 30 points. as you can see, you know, home depot, we got to talk about this eventually, frank blake is really good. >> god bless him. >> obviously. and do you have -- >> well reading through the report. this is one of these situations where it's all about execution. you talk about companies missing or not delivering. >> 6% same-store sales? >> execution. that's market share gains, growing the top lines and execution. >> lowe's won't necessarily do as well you're saying?

>> you cannot say that because home depot is executing and bringing in more people that it's necessarily meaning that the entire industry -- >> because retail has not. even remember macy's was the last nail in the -- >> home depot was about execution, significant management execution -- >> does it mean that housing is maybe we're missing something thinking that it's, you know, not recovering as -- people are pointing to housing -- >> i would read into home depot about company specific execution in terms of making the customer experience better. >> do you think housing starts will be better than expected at 8:30 because of the home depot numbers? >> i have no idea. bob frank may know. >> i can tell you what's happening with mansion sales but they're not shopping at home depot. >> mansions need to be remodeled. >> they do. >> just not by the people -- >> it's more like the restoration hardware. >> the people who own them aren't going but the people who are building them are going. >> the underlinks. >> the butlers and contractors. >> do you just -- if we talk housing it's got to be mansions with you? >> yeah. otherwise i'm clueless. >> will not get on anything less

than a g-4 -- >> i flew back from back from pebble economy. i'm an economy guy in my real life. >> something happened. i know you were supposed -- you better get a better -- >> anyway. >> you better get a better agent. >> we're talking about google. google's initial public offering happened ten years ago and boy did it make a lot of people rich and mr. rich right over here robert frank joins us with a look at who's cashed in on google's shares since going public. mr. rich. >> yeah, you know, when google went public on the day they went public the shares were the total market cap of the company was $27 billion. now it's 391. so that's 360 billion dollars in shareholder value and wealth created. that is earned success. now the biggest winners, of course, larry and sergei. in 2004, remember that ten years ago, they were worth $3.8 billion each. ceo eric schmidt worth $1.4 billion. now larry and sergey are the 12th and 15th richest people in

america with $32 billion. eric only worth $9 billion. he'll still be back. google has become one of the biggest millionaire machines. estimates say at that day the ipo about 900 people became overnight millionaires. everybody from the company's masseuse. remember that "new york times" story? early hires. the company chef this guy charlie ayers used to be a cook for the grateful dead, he owned shares that became worth $46 million after that ipo. now since the ipo, post-ipo, the ten years -- >> did he hold the shares or did he sell them? >> it was unclear. but they were saying the value of those shares that were given to him were $46 million. since the ipo in the ten years since we've had another 1,000. estimates say about 2,000 millionaires created in the ten years since google went public. now i talked to several google alums and millionaires yesterday to see and you start to see sort of two patterns. first a lot of people stay at this company for a long time even after they get rich. so that's a good sign they've been able to retain these folks

even after they could just cash out. the second thing and this is the most interesting, those who leave are using their money to start or fund other companies. they're called google angels. and there's this whole generation of them that have gone on to start other compan s companies, i spoke to eli gill, a google alum. he estimates that google angels have funded hundreds, if not up to 1,000 start-up companies. you look at everything from twitter, evan williams, and ben stone spent some time at google, pinterest, ben silverman was a googler and the climate corp founded by david freeberg. it sort of changed the model of the cash jut, right, gary you know this, the cashout you get your liquidity event, you become a morgan stanley client, you buy your boat, you go to the beach. and now the model is increasingly "a," you're younger. so you don't want to retire. and "b," you want to stay in the game. you want to start all these other companies. by the way i remember on the day that google went public, or that year, the california tax collectors got a $200 million check from a google executive

who cashed out options. and they just had never, ever seen anything like that. so in addition to the wealth creation, you've also had huge tax revenues created with all this stuff. >> do we know of folks actually google angels who've actually invested in something successful, second round? done it again? there's an encore performance? >> nothing that -- none of the companies that we would have heard of. they're tons of small companies still in their infancy, i was given a list of angel and google angel projects. i hadn't heard of any of these companies. but there are hundreds of them out there. >> right. >> that could become big. >> and morgan stanley ended up -- you guys worked on part of that ipo, right, at the time? >> the ipo if you remember -- >> it was the dutch auction. we're going to have him on in just a bit. did you get the wealth management business? >> well, i -- >> you weren't there at the timer? >> i was at newburgher -- >> when i look at that, barks ten years and the numbers i was

pointing out, what i think about is the organic growth. look at that market capitalization. that was primarily organic growth. yes, there was some fold in acquisitions like youtube and stuff like that. but when people say you can't gre a business organically, you know, that everything has to be through acquisition, that to me spells you can grow a business and create shareholder wealth organically. >> and it's not just about the money. i'm a little skeptical with everyone at silicon valley so sanctimonious, it's about impact and not money. but the fact that these guys stay at google for a long time, even when they're rich enough to leave and the fact that they really go on to start other companies maybe it's about the bigger money than just the money. but, it's -- it's not really the wall street model where it's like you cash out, and you're done. >> right. >> thank you. >> thank you guys. >> appreciate it. we're going to talk more about this in the next hour. >> that's true. coming up, rory mcilroy, in town for the barclays. here in northern new jersey. our dominic chu caught up with him to talk tv ratings, golf's future, and much more. and then in the next hour, the

natural gas boom helping atlas energy's bottom line. the company's ceo tells us why, as the economy improves, so should demand. and as we head to break take a look at where nat gas prices are this morning, 3.85. >> coming up. >> trivaugo shows you all the difference prices for the exact same room. >> the pitch man that for one reason or another you're mesmerized by. he's amassed a huge cult following on line. and he's here to chair this story. it's the trivago guy, live.

rory mcilroy hitting the big apple this week. cnbc's dominic chu joins us. he sat down with rory to talk about the business of golf. how did you get this interview? >> you know, this is just -- >> can't really tell us how. because we've got to hurry then tell me off camera. >> i will. they're unveiling new irons, and they wanted to show what those irons were all about with nike. >> nike is. >> with rory mcilroy and tiger woods. and, those two are characters and the reason why golf may be seeing an upswing is because we've got more characters to talk about. rory mcilroy sat down with us and talked about maybe a little bit of the character of the cast of characters that may help revive the game of golf. take a listen to what they said. >> it's hard to call it a rivalry, or rivalries in golf, because it's only, you know, if you take the previous rival which would have been tiger and phil, they only went

head-to-head, you know, a handful of times over their careers. it doesn't quite happen as much in golf as it does in other sports like say in a tennis where you'll have nadal and federer play a lot of finals. so, it's very early stages. but i think the young guys coming through, myself, you know, rickie, jordan, and a bunch of other, you know, young guys that i haven't mentioned there, you know, we can compete for majors for a lot of years to come. and i think it is important in all sports that they have, you know, as you said, main protagonists and main characters that compete for these majors. golf is a very deep sport right now. there's a lot of guys that can win. there's a lot of guys that have chances to win big tournaments and majors and you know i think it would be great if a few guys were able to separate themselves from the pack and be able to slug it out for some of the bigger tournaments. >> you are the golfer of the moment. you got the hot hand. how does a golfer like you keep that going? what are you doing personally to

make sure that you have the longevity to make that career in golf one of the great ones in history? >> i mean, i -- i'm not -- i'm not thinking 10, 15, 20 years down the line. i'm thinking the next week. i'm taking this week by week, and i've had a great run so far. and i want to keep that going. you know, i've -- i've played some great golf over the past few years. i've got to four major championships. but i just want to keep the stretch of golf going as long as i can. and there's no point in me trying to think 5, 10, 15 years down the line, because you know, i don't know what's going to happen next week. i'm just going to try and make the most of every week that i have and go from there. >> guys, i will say this. the guy is a physical specimen. he's taking care of himself and he's working out a lot to get his body in shape. >> you hit straight 330 yards. neither one of us bigger than him could ever do that. >> no. not even close. >> oh, i know. >> jordan spieth is only 21

isn't it or 22? >> yeah. >> so much going on. thank you. we've got to run. >> thank you, coming up the man who brought us the dutch auction, bill hambrecht on google's ipo anniversary. and later, is cool a bit creepy, smooth yet rough it's the trivago guy right here live on "squawk box." han ever, we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present. we stathat the kid on thehought back of the bus might have a song that he has in his head but he just can't get out. with the technology of cloud, we change all that. i can sing something into my device, up to the cloud it goes, back down it comes, sounding better.

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google's dutch auction took the market by storm. we speak to the man who helped take the tech start-up public. >> plus a special look at where the company is investing for the future, from wearables to voice and data. what's next for the tech giant? and the pitchman that's turned in to a social media rock star. >> trivago makes it easy to find the ideal hotel for the best price. >> tim, the trivago guy, williams, joins us as the final hour of "squawk box" begins right now. welcome back to "squawk box" here on cnbc, first in business worldwide. i am joe kernen. >> who are you? you're joe kernen?

>> yeah, that's him. >> along with andrew ross sorkin of tax burden not as heavy as it looks fame in "the new york times." becky is on vacation. in studio this morning gary kaminsky. feast our eyes on that. chairman of wealth management -- >> you see the headlines. andrew wants us to pay more taxes. >> why don't we just turn -- doesn't krugman have the same column today? oh, he's not in today. i'm sorry. >> sorkin, taxes, pay more. >> andrew, what's making -- >> please calm yourselves. we have some headlines to bring you this morning. shares of dow component, home depot, they're hitting an all-time high this morning. earnings and revenue beating the street. home depot also increasing its full year earnings forecast after a strong rebound in spring season sales. also we should tell you a bipartisan group of lawmakers slamming the fed. that group sending a letter to chair jabate yellen urging the

central bank to restrict its crisis lending programs for big banks. the 15 lawmakers argue if the fed's power is unchecked the lending can once again be used to provide massive bailouts without congressional authority. i bored the heck out of you yesterday -- >> then i read it and thought it was pretty decent. >> it's the living wills issue, which the fed has told the banks -- >> but they changed their minds. >> because we're not going to provide the discount window part of this debate is about -- >> when i went home i head it so that i could -- so we could talk about it and have something in common because the tax thing, that's not going to work for us. but, with that one, in 2011, 2012 -- previously they never really said that they were going to not allow that. >> right. >> and there are critics that say if you're not going to allow that, then why even have it? and i don't really -- >> i understand -- >> understands what we're talking about. >> but i understand -- >> don't worry about it. you never do it -- but i don't understand -- i do understand why they'd want to make banks have their own private sector

remedy if they get in trouble again. >> without help. >> exactly. >> for the too big to fail, the idea that it's not been fixed yet, and they didn't ring the bell -- >> thank you for -- >> it was smart to -- >> ten years ago today search engine giant google went public by way of a very unusual dutch auction. bill hambrecht is here. he was the architect of that internet based ipo. he also helped back the ipos of amazon and netscape and took apple public, as well. and he's actually here in person. we often have him on the show but you're usually on the other coast waking up very, very early. not that this isn't. but it's great to have you ten years later. not to be a downer or a skeptic, look at the dutch auction. i remember all of the hype around that, and i remember writing about it and talking about it. you know, incessantly, and here we are ten years later, and it hasn't really taken off as a trend. why not? >> well, first of all, i think i made a mistake. in that after the google

offering we did a number ofologyings that were really, you know, morning star, interactive broker groups, some really good ones, on our own. and after the interactive broker group, the bulge firms came to us and said, okay, enough is enough. we'll work with you. and we'll use the auction. it just didn't work. because they just don't want to use the auction. they don't want to give up the ability to allocate shares as clients and most important they don't want to give up the ability to discount the price. >> so this was about the big, in this case, the big bad banks. it wasn't about the model its f itself. when you say you made a mistake, it's not the model? >> i think the model is still very viable. we are now back in the game in the smaller deals. where we're not competing with the bulge girls. and yeah, i think ultimately i think it's going to win. i really do. >> gary, you had a question. we're talking about this during the break -- >> first of all, i agree with

bill when we fought back on the ten years. remember, too, bill, it's also that the sellers like the traditional model, the sellers of equity on the initial public offerings, like the traditional models are, because they know in terms of an underwriting that they're going to get a minimum price. the issue really was with the auction, you know, is it guaranteed, and so i think that there's a combination of both. bill said he was wrong. i'll tell you when i reflect back on google i was wrong because i remember i was in newberg at the time we put in for a deal. we got a doughnut because we came in below the clearing price. what i've always wondered when you look back at how that was allocated was it the traditional large cap technology funds that would have in a traditional ipo they would have gotten, that would have gone in for 10% of the deal and gotten a nice allocation? when the deal was actually priced ten years ago, was the traditional long only large cap technology players well represented. >> no. the two major buyers, the guys who really made the auction work, were fidelity, and legg mason.

bill mueller. they're the guys that put in the bids at 85 that really solidified -- >> so fidelity, though, wasn't in the select technology fund was just fidelity as an institution acrossed board? >> it was a specific portfolio manager. but, he led the charge. >> one thing i can remember, and it was not just pen did its, it was everyone. and i mean you -- eggs, there was a run on eggs for as much egg on face that there was on that offering. do you remember how many people said it was going to be overvalued? didn't it come at 80? >> 85. >> i would say 95% of people at 85 said that that was totally overvalued, and within a year it was what? -- >> it opened at 100. and it traded up to 130 after the -- >> but there wasn't enough egg in the world to go on the face of the -- >> here's my question about that egg. which is had you pursued a more traditional model, would have cool raised more money or less? >> i think less.

in that some of the original price ideas from the traditional bankers were 60 to 70 dollars a share. >> why was it so missurprised then? i mean, on -- >> well on the low end relative to where it is today, obviously, but even where it was within twelve months? >> well, first of all, it was very controversial. as you've said. there are an awful lot of people that didn't get it. >> you were also coming post-2000. post -- 'th where you had other companies like yahoo! which 250. you had to bench mark it against other technology stocks which are coming down very, very hard in the previous three years. >> yeah. >> but i think, bill, if you open an ipo at 85 you price it at 85 and it opens at 100. wouldn't you say traditional banking models that that would have been euphoria? that's like the perfect pricing appreciation after a pricing of a deal. >> yeah, 15% to 20%, that's what they shoot for. >> right. you're saying if it had been

priced traditionally as opposed to an open auction it probably would have doubled -- >> it would have doubled. >> we've seen a lot of technology stocks in the last couple of years. double on the ipo price. >> do you think it would have been a linked in? >> yeah. >> do you look at a linked in or even a facebook as a failed ipo, or a successful ipo? >> well, i think it's pretty hard to call facebook successful. i mean, they lived through a year of real pain. i think facebook shows how difficult it is at the market without an auction. >> right. >> you know it's just -- >> because the week before, you know, there was some sales figure that wasn't as good as it was, and then the analysts say run with that, and question the whole underlying rationale. i think you're right an auction is the best way. it's the perennial question you're never going to have it answered. do you leave more on the table or do you want to get a huge price, a huge pop right at the beginning. if you only sell 5% you want the

huge pop because your 95% is worth where the huge pop goes. >> well look for 30 years we did traditional underwritings, and i always preached, yeah, take a discount because if you become a winner in a mutual fund portfolio they'll hold it. and when you come back to the market for more money, they'll buy more. because they always quantity to look good. that changed. and once the premium became embedded in the system, 95% of that stock that's typically allocated gets flipped the first day. so you don't get any value -- >> bill you mention h&q -- >> did you go to work at h&q every day? >> well, no, not really. someone else is running the firm. >> you don't even go -- you had nothing -- >> oh, no, i'm -- major owner and i'm there. >> so you do go in every day. >> oh, yeah, yeah pretty much. >> when you reflect back on the ipos, the companies you brought public through hambrecht and quest obviously talking about google, there were some great

biotech companies, other technology names, which is the company you think when you reflect back was the greatest capital raising in terms of what the business has become now? >> you know there were three companies that i felt were great examples of different ways of financing. apple, obviously, genentech. genentech is one i was really proud of because we did that, you know, three years before its first product. >> you should be -- and raising money for something that's done that good -- >> it was brand new and created a industry. >> saved a lot of people's lives, too. >> oh, yeah. and the one that i was really proud of personally was adobe. because that was an example of a little company with a great idea that steve jobs wanted to buy it. came in, did $40 million for it. and we had to do something. so we took them public for $5 million. so everybody got a little liquidity. to me, that's the one i'm proud of. >> you remember who was running

h&q before this tragic untimely death and you wonder what's with that family. a bunch of overachievers. do you remember? steve case's brother. >> dan case. >> dan case was running it before the sales of chase. >> and dan got steve his first job as a salesman at aol. >> yep. yeah. >> remarkable family. dan was just a brilliant guy. >> overachievers. >> bill hambrecht, thank you for the memories and a little perspective on this -- >> you can imagine being in san francisco during the heyday of tech and working for hambrecht and quest. >> montgomery -- >> -- at the ritz-carlton. >> i still enjoy it. >> robertson -- >> robbie stevens. >> the four horsemen. who owns the city now in terms of banks? >> that's hard to say. there's really no -- the local firms have been largely bought out. well, goldman is always very strong, morgan stanley very strong, jpmorgan is very strong.

>> it's good. >> thank you. >> coming up we're going to talk to the ceo of ellis energy on why he sees an opportunity to export natural gas then a read on the housing market. july housing starts at 8:30 a.m. eastern time. and then later, what's with the weird obsession with the trivago guy? we're going to find out. when we speak to him live right here on "squawk box." tomorrow on "squawk box," paul ryan's journey from the small town of janesville, wisconsin, to the spotlight of washington, d.c. he's out with a new book, the way forward. and will be our special guest host. why he's upset about the direction the country's going. and what he wants to change, jobs, the economy, and politics. a special one-hour event with former vice presidential candidate congressman paul ryan. tomorrow right here on "squawk box."

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welcome back to "squawk box." making headlines this morning. the faa now barring all american

airlines from flying over syria. the agency says the ongoing conflict poses a quote serious potential threat. in the past the faa had only warned carriers to avoid the country. joe? >> okay. you've been to -- you've been to the jersey shore? >> i have not. >> you two! you know what? i can't -- i can't -- >> but actually i'm just -- >> you've never been? >> been to the delaware shore, rehoboth. >> you know that piece that sorkin wrote today, i don't know if we mentioned it because somebody e-mailed it around, copy and pasted it and sent it around to the entire firm. how did you make that happen? >> you know who we have on tomorrow paul ryan? i'm going to let paul read it tomorrow. he's going to be here and both of us are going to gang up on you and spank you like a -- >> huh? >> yeah, yeah. that's what we're doing tomorrow. >> i will wear my kevlar. >> you're getting a lot of promo. >> andrew, my word. are you a different person at that paper? is this really who you are that i'm with every day?

>> this is -- this is me, baby. this is me. >> good, it's yin and yang. now to natural gas prices. we're inclusive. we want everyone to watch. down more than 14% since midway. our next guest warns a bigger drop could be becoming simply because we're seeing too much of a good thing. ed cohen is the ceo of atlas energy. and everything we do, ed, in this business, the investment management or i mean the news business, it's all about good news and bad news. everything we talk about is half empty and half full and we can talk about things going up and down based on the same -- the same thing. and i would think it's the same with you, right? >> well, i think the future is really great. there are ups and downs but the economy is expanding. and the increasing amount of natural gas and oil that we have just has to be good for the country. and i think it will necessarily be good for the countries and

the industries. >> look at the wealth of -- i mean we think about what it's done for the country, and for our future in terms of input costs for energy, and manufacturing, it's opened up a whole almost a renaissance possibility for this country in terms of our energy needs. and yet we found so much that natural gas is stuck at $3.85. so it makes it harder for companies like you to make money. it makes it harder to justify, you know, certain projects that might be more costly than others. it's almost a, what's it called, a something of riches? >> embarrassment of riches? >> embarrassment of riches. it's too goo, ed. >> it's been great for our company and i think it's been great for the industry. our stock's up 400% in the last three years. and i think that we have a temporary problem in that the demand has not kept up with the supply. but the demand is really, i think, virtually infinite because we have the whole world out there. i have been discussing

previously the fact that for the first time pioneer down in texas has actually been exporting with government permission from the department of commerce, oil in the form of condensate, and that although it's not a blanket permission for the entire industry they're going to handle it on an item by item basis i think that's a glacial change. a major change and that's why i'm optimistic actually about where prices are going. >> do we need to build an lng structure to export? >> we are building it. we're very fortunate that we had a large portion of that infrastructure already built. unfortunately it was built to import. good heavens if we were actually importing natural gas today, as people intended, our balance of payments problem would really be unbelievably out of control. but we've been able to a large extent to take steps to reedge near that import facility infrastructure so that we'll be able to export. it's just so important for the country, i think for the good of

the world, and i think for companies in our business, despite the fact that as we produce more, prices do have a tendency to go lower in the absence of an increase in demand. that demand is there. it's worldwide and the united states should be able to take advantage of that. >> let me ask you quickly about the mlp asset class structure. obviously you use it. rich kinder said last week he doesn't use it. what do you think of that deal and are you going to have to reorganize that of the mlp asset class now? >> i think as usual rich is great. and he said it perfectly when he said it doesn't make sense for him anymore. for the rest of us, it's an opportunity really to revisit our situation but just because it doesn't make sense for rich doesn't mean it doesn't make sense for the rest of us. >> becky would normally do here -- >> she would do the all natural

gas. she wants to hog it and keep all of the rich resources we have, keep them domestically. but i think it's a really a great opportunity to export this, right? >> we have more than enough for everyone. obviously we want the american consumer to continue to enjoy the benefits of natural gas which is so clean and which is relatively cheap. but it's sort of like winston churchill famously said before el alamain the british never won a battle after they never lost a battle i spent 25 years drilling for natural gas and oil and we always were disappointed. the results never were there. that's why companies were leaving the united states. we're from pennsylvania. companies were leaving pennsylvania. but in the last five years or so, we've never had a situation that hasn't been enormously successful. when you specific about a shale revolution for the people who actually are in the trenches, the emotional impact is unbelievable.

i spent years trying to produce natural gas because i knew it was good for the environment and for the country. we always were disappointed. the last five years have been like a revelation. it's always successful. and that's why we can export and we can provide for our people in the united states. >> all right, thank you, ed cohen. it is, it's a great success story. >> thank you. >> totally private sector that generates -- you know, in spite of everything else. on a programming note, don't miss mad money tonight jim is focusing on a gas and oil theme all week. and there it is, behind the boom. it's at -- doesn't have what time to watch. everybody knows. >> 6:00. >> 6:00 eastern time. >> coming up, a read into how the housing market is faring through the first half of the year. but first, just how much does it cost to raise a kid these days? the numbers may stagger you. and they are up there right after the break. we will tell you all about them. the futures right now at this hour take a quick look before we go, dow looking like it will open up higher about 30 points

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welcome back. new parents beware, your little angel is going to cost you a bundle. the department of agriculture says that a middle-income family with a child born in 2013 can now expect to spend more than, guess what this number is going

to be, $245,000 for food, shelter and other expenses up to the age of 18 years old. now that's an increase of nearly 2% from the prior year. the annual report found housing was the single biggest expense, average about $74,000. or 30% of the total cost of raising a child. that's followed by child care and education. and then there's food and transportation. the good news, the government says families that have more children can expect their average costs to decline. so the more children the better. however, those parents with kids in new york city who send them to private school, that number -- >> bunk bed, hand me down. >> i'm thinking new york city private school at $40,000 a year. think about that for 10 or 15 years. >> we're not all a bunch of -- >> you could move to a place where there's a public school district -- >> bied w by the way i am distr for public school --

>> we're not all elitists. we're the exact opposite. >> we're the exact opposite of elitists? >> yeah. >> coming up we're going to do housing starts data. plus sweating, clapping, shouting. you've seen it before and steve ballmer did it again last night. this time for the clippers. that story just in a moment. >> that gets old, man. >> trivago shows you all the different prices for the exact same room. >> the pitchman that for one reason or another you're mesmerized by. he's amassed a huge cult following online, and he's here to share his story. it's the trivago guy. live.

welcome back to "squawk box." a litany of data. cpi for july up 0.1. as expected strip out the all-important food and energy also up 0.1. year over year head line 2%. year over year 1.9. no inflation out there. let's look at housing starts for july. 1.093 million. a bit over 1 million, this is pretty good news. considering our last look was revised upward from 893, up a

handle to 945. this takes us up to 1,930,000 -- i mean 1,093,000. this is a good number of 15.67%. but remember, it is based on revision but it was an improvement. permits what may be down the road also leapfrogged a bit. 1.052 million so 1 million 5 2,000. this comes from revised 173,000. so we are seeing some pretty decent data out here on the housing side. and this really is fascinating based on the home builder's index jumping a couple of points yesterday. i know the index could be affected by lower interest rates and this is july data and interest rates did move lower obviously over the last couple of weeks so low rates is never bad news for housing. it's just how much bang for the buck you get at these levels, considering the history of housing. we're seeing yields, you know, basically getting close to the 240, but 237 and really hasn't

changed much. and the preopening stock levels have improved a bit. the dollar has been doing well, because the euro isn't. so to summarize the data today, inflation is certainly not cold, it's not hot. some would argue it's in the middle. i didn't pick 2% as the annual rate the fed did but the housing number's improved. back to you guys. >> great, rick, thank you for -- did you read the "times" today, rick? >> no i always have to fight the bird for the times. today i lost. >> just check out andrew's column. maybe we'll talk about it tomorrow. it's every tuesday, isn't it? >> supposed to be. >> i'll have to make sure. i'll look it up online. i don't know what i want to donate -- >> the title is tax burden not as heavy as it looks, basically. and about these companies, and stuff. so -- >> oh, the fact that it's only a couple of billion a year and that you know basically this administration and this congress, they use that for -- >> what money?

>> are you talking about inversions? >> yeah. >> the premise is actually the actually corporate rate is lower? >> the premise is that u.s. corporations actually have some of the lowest effective tax rates in the world, and so the argument around the territorial -- changing our system to become more territorial, and all of the ish as surrounding lowering the rate are much more complicated -- >> andrew since you've researched that thoroughly i'm before talking about that a long time, years. because it all is a game about taxes. yes the effect ef rate is low. but you have to consider the size of the entity. and that's where it goes off the rains. the big boys, the ges, the coca-colas. >> correct. >> they can get away with it. but smaller businesses do a lot of hiring -- >> and the little guy is not. >> but if you move facilities offshore. >> yes. >> doesn't that lower your effective tax rate? >> yes, but -- >> wouldn't it be good to bring them back here if they didn't have to move them offshore? >> the largest point is a lot of u.s. multinational corporations

may prefer to do it this way. meaning when and if we get to a point that we want tax reform, there are multinationals that may campaign actually against -- >> not better. >> everybody's -- >> now andrew do the correlation between those big multinationals and how much lobbying money they spend every year. that will be a fascinating article, too. >> thank you, rick. >> thank you. >> all right, we're going to go to the housing numbers now. chief economist at trulia joins us along with our guest host gary kaminsky from morgan stanley. and just like every time we talk about housing we say better but we still wonder why it isn't even better. is it good or not? >> today's numbers are very good. construction is one of the lagging activities in this housing recovery. prices are almost back to normal. sales have been improving, they're more than back to normal. it's construction that's really been lagging especially in local markets that were really hard-hit in the housing bus. what we saw today, big increase, a lot of that was on the

multifamily side. now people have been sort of downplaying the multifamily side because that's more volatile. that's been a big part of the construction recovery. when you look at the markets that are seeing a construction boom right now, relative to what's normal to them, it's places like new york and boston, san francisco, los angeles, places where most of the new construction is multiunit. there are apartment buildings in anticipation of a lot of those young people moving out of their parents' homes and forming new households. >> what's the problem, then, with the single family market? >> one of the biggest problems is that there are still a lot of vacant homes out there. even though the inventory is tight in a lot of markets, there are a lot of homes vacant and being held off the market. builders don't build where there are a lot of empty homes. even in places where we expect there to be long-term growth, places like florida, parts of the southwest, you know, there are still a lot of vacant homes in markets that saw overbuilding during the bubble. until those vacant homes get filled up, until the economy continues to increase to improve, until we see even more household formation, in those

markets, we're not going to see a full construction recovery until more of those get filled up. >> is everyone moving back into the city? >> no, everyone is not moving back into the city. we are seeing faster growth population growth in cities than we did during the bubble. remember, big cities actually -- >> andrew just told me that the entire demographic trend to the world is that the suburbs are moving back into the urban areas. >> you know, in fact, the denser suburbs, some of the smaller cities, they are still growing faster in terms of population than the largest cities -- >> wait a minute -- >> just -- >> is that -- >> you weren't part of the conversation but the three of us were having a conversation but that's the multifamily units are being built in the cities. therefor those that want to rent are going to where the multifamily homes are. if there was a multifamily development that was in the suburbs, wouldn't the demographics mean that they would go there? >> there could be more of a shift in suburbs, depending where the construction is. but i think the bigger point is that we're a point in the

economic cycle where there's a lot of demand for rental. and more demand for -- >> it's not going to change though. do you think that demand for rental is going to change? >> yes. i do. i thinks demand for rental is going to change because we're a point right now where a lot of young people are moving out of their parents' homes and they're going to rent first before they buy. the biggest demographic is folks in their early 20s. these are not people who have been buying -- >> my son is -- my son -- he's moving out, he's moving out next week, renting. i could tell you that buying a home is the last thing in that demographic's mind. especially after seeing what happened in 2000, 2009. those people are going to rent. those kids are going to rent for the next decade. and that's why you see new construction of multifamily. >> when you look at the likelihood of home ownership, are young people owning today? the biggest reason why home ownership is low among young people is because demographics are different. they're getting married later, having kids later. with you compare young people did with young people of the same demographics, ethnicity,

marriage, 20 years ago the home ownership rate looks essentially the same. this is not a big change in attitudes, this is a change in fundamental demographics that's not likely to reverse which means the age of home ownership is getting later -- >> i'll bet you 100 dollars -- >> i can new the new york centric, maybe san francisco take you average city k.c. or something indianapolis or denver. people are still moving -- they're not moving back into these cities. >> right. when you look over this whole cycle, so, don't look at -- >> i want to lose points and tell you i'm not sure those are cities. but that's a separate issue. >> oh, wait a second. denver is not a city? why do you do this to yourself? >> did you just say indianapolis is not a city? >> indianapolis is a city. >> how about cleveland? >> denver less so. >> actual a little bit -- >> kansas city? >> i'm losing points as i speak. >> the city snobbery. >> terrible, isn't it? >> when you look at what's

happening since 2000. >> my life. >> i feel bad. >> he just sets himself up. >> denver is not a city. >> -- over this whole cycle over the recovery, the boom, the bust, the places that have grown the most since 2000 are pretty much the same places that grew most in the last two decades of the 20th century. the underlying patterns of sun belt cities, midsize cities growing fastest that hasn't changed fundamentally. right now there's a lot of demand for living in cities but the underlying long-term pattern is still faster growth in midsize cities in the sun belt. >> well, have you been in the studio before? >> yeah, i have. >> oh, you have? >> normally we have you on remote. good to have you here. you got -- and you definitely told him exactly how it is. >> thank you for coming in. i want to thank all our viewers from all over the cities all across the country. >> you can't make -- >> he wants -- >> i want to go down a list. how about portland or seattle? >> there's downtowns.

they have downtowns. >> but they don't have cities. >> you are so warped. >> anyway. >> a number of stocks on the move this morning. aeropostale hiring its former ceo. dick's sporting goods posting better than expected quarterly results. this as golf and hunting sales continue to decline mr. kernen. gore's declining. >> i know. >> elizabeth arden needs a little bieber fever. the company posted a bigger than expected loss. revenues also missed the mark, steeper than expected drops in celebrity fragrances, particularly those by justin bieber and taylor swift people don't want to smell like the biebs. i don't know what's going on. shares of tjx popping right now. that retailer earnings two cents better than expected. coming up -- >> people are tweeting in that he grows his fragrance organically. >> he does. the man we've been talking about

all morning, trivago capitalizing on its pitchman. he is here, they've been all over social media social media hit actor tim williams the trivago guy joins us to talk about his pitch man success and what he thinks about what people are saying about him. spokesperson: get a $1,000 turbocharged reward card with a new volkswagen turbo. why are we so obsessed with turbo? because we like giving you power, but we also like giving you fuel efficiency. like the sporty jetta. and the turbocharged passat tdi® clean diesel. okay.. and the iconic beetle... and the powerful tiguan... okay you can't forget the cc... guys, this is going to take a while. avo: get a $1,000 turbocharged reward card on new 2014 turbo models or lease a 2014 jetta se for $169 a month after a $1,000 bonus. over 1.2 billion eyeballs are on us during the two weeks at wimbledon. true tennis fans want to know what's happening. they don't want to just see what's happening, they want to know and understand why it's happening.

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welcome back to "squawk box." travel search site trivago's pitchman has been described as both cool and creepy.

also sexy and sloppy. whatever the case may be there's no denying he's generated a lot of buzz from the moment those commercials started to air. with us now on the set is the face of trivago himself actor tim williams. thank you for being here. >> thank you very much. >> this has sort of gone viral in the craze -- did you ever expect this? >> never. i don't think any of us ever expected it. a few weeks ago started coming out. i got an e-mail from my father, a few e-mails and a few tweets from some friends. i'm like what's going on? i looked at it for myself. okay, here comes some negative. here comes really good positive. i was like oh, my god. >> did you take it personally? >> no. no i laugh. i have a great time. >> how did you get involved with this company trivago? >> i did a voiceover for the american market. just my voice. you didn't see me, and friend of mine, he said, as a director, he said, you know, let's get new front of the camera. you're there now and let's use you as our pitch man. >> do we know what trivago stands for? >> we were just going on. it could be trip vacation go.

i'm not really sure. >> you're not really sure? >> trip vacation go is a good answer. >> how much time -- you -- do you know the folks at the company very well? >> yes. some of them. not all of them. i just visited the offices in dusseldorf two weeks ago. >> do you use the confidence? >> yes, i do. >> what have you done with it? >> well, i get in my car sometimes if i'm traveling with my friends, we need a hotel somewhere. i go to my app. i punch it in. i punch in where i am because of the location services on the phone. and it tells me the best hotels and the best prices right in the area where i am. so i just jump over there, check it out, book a room, and -- >> now your voice is extremely recognizable for those that watch the commercials. have you ever had any crazy things where you call somebody up, ordering a pizza, some chinese food or something and does anybody ever recognize your voice? >> not yet. but it's funny when you walk in somewhere and you say something. they look at you. they may not know you from the commercial. they don't know you, they can't pinpoint it and they say okay,

that's -- i know that guy. >> but you speak a little bit, trivago guy. oh, you're the trivago guy. >> okay. now you're an actor. how has this changed your acting trajectory? is this helpful? are you going to be pigeon holed as the trivago guy? i remember the dell dude and he used to talk about how he struggled actually to get other roles because people thought of it him as the dell dude. >> i've had a few offers since the commercial came out. i feel like i'm pretty safe. i did kind of establish himself in germany, at least, as an actor. so it was, you know, easy to jump into a commercial. nobody knew the success of this commercial what it was going to be. nobody. and we're just very lucky and very happy at the moment. >> some people argue you need a makeover. what do you make of that? >> makeover that's the contest we're coming up with. you have to get your outfit that you think i should wear in the next commercial, you have to submit that by sunday, this sunday, to #trivagoguy, or go to the trivago facebook page and you pick out an outfit.

you, you or you, pick out an outfit you think i should wear. >> do we have the v.o. of that? i tell you i -- >> didn't say anything about the stomach. >> i didn't know what the -- i never even knew who you were representing until -- but i noticed you and you're wearing -- your shirt is not tucked in -- or it is stucked in but you have a totally flat stomach. i don't know if i'd be envious, i was angry that you have no gut whatsoever. that's what i noticed you have no gut whatsoever. and that's all i knew about you was that you had no get. i'm not -- with my own struggles. but -- >> the no gut guy. >> what can the makeover include? >> anything. anything they wanted. use your imagination -- >> so you don't have a beard on the -- see i think you do. >> on their -- >> i can tell you about the beard because i was doing another role at the time. i was doing good times, bad times in germany. and i played an american rock star so i had a goatee and some hair on my face already and i had longer hair and i had to keep that for continuity. >> are there any american soaps left that are popular? you would be a good soap guy.

you know what i mean? be in love with someone. problems. you could be the other man, there's a lot of different roles. >> it's always like that. they still have soaps in america? >> they've become less popular as everyone's moved back into the city from the suburbs. they don't really watch -- >> do you know that -- >> i'm going to roll that back. i 345ed a comment about cities. >> andrew, do you know -- >> i love all the cities. >> denver has an omelette, used to be named after it. >> denver is not even a city, even though it has an omelette named after it. >> my sister, my nephew, my brother, they all live -- >> i don't want to -- >> you said it wasn't. you said they shouldn't have kids on flights either. >> we should put the united states on the big wall and have andrew go up there. >> joe as you know so well occasionally you try to be funny and it doesn't work. >> i'm usually pretty funny. maybe you know about that. >> thank you for being here, mr. trivago guy. >> no problem. >> we appreciate that. coming up what's google investing in now.

jon fortt, a special report on the tech giant and he's at it again, steve ballmer pumped up for his next big gig. that story right after the break. "squawk box" returns in just a moment. >> tomorrow on "squawk box," paul ryan's journey from the small town of janesville, wisconsin, to the spotlight of washington, d.c. he's out with a new book, the way forward. and will be our special guest host. why he's upset about the direction the country's going. and what he wants to change, jobs, the economy, and politics. a special one-hour event with former vice presidential candidate, congressman paul ryan. tomorrow, right here on "squawk box."

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liberty mutual won't raise your rates due to your first accident. switch to liberty mutual insurance and you could save up to $423 dollars. call liberty mutual for a free quote today at see car insurance in a whole new light. liberty mutual insurance. welcome back to "squawk box," for those of you in new york or west coast, rest of you still bailing hay, tending to the chickens right now, futures up 38 points after a big gain yesterday. if you're not in a flyover state, we want to tell you that ballmer's back. >> i was trying to be funny. >> did not succeed, clearly. the former microsoft ceo introducing himself to l.a.

how about l.a.? that's one heck of a city. >> l.a. clipper fans, he doesn't -- is it real? >> it's real. oh, it is real. >> clapping and shouting until he was nearly a horse, sorry, until he was hoarse. paid $2 billion to buy the team controlled by a former owner, donald sterling, who, as you know, had problems. let's get down to the new york stock exchange. jim cramer joins us now. we had a really interesting conversation with the atlas and natural gas, and i know you're doing a lot with that. whether we import or export, but interesting thing is, jim, the better it is, it's the best of times, the worst of times, you know, so you find all this great, great for the country, manufacturing, and input, but, you know, it's almost too good. >> well, look, the story does not get to be told because

there's not enough people willing to talk about it. the fact that spot natural gas prices right now, right now in new york city are lower than louisiana. why is that? the largest gas fuel in the world. it's the largest if you include virginia and a lot of kentucky. this is just happening right now. the fact is we are paying so little for natural gas because of this, and yet who talks about that? our president? >> jim, it changes the whole dynamics of how long is it going to be cheap, and what does that mean for the long term prospects per ptu of all the things that never get down to the price? changes the whole game for trying to develop an energy future. >> well, the cost of the wells is going down. range resources talking about a 27% decline, so, actually, our price of natural gas is coming down. >> solar and everything else makes it harder for those to be

economically feezasible. >> if we cared about global warming, it puts tremendous pressure on coal. imports coal. coal is problematic here. i know there was on "fast money" yesterday, someone recommended comb, and coal stocks likes bottom. be careful with coal. this is the death note for coal. it's just the death note. >> okay, jim. we'll watch. >> thank you. >> "squawk on the street" and "mad money." >> what about philadelphia? i misspoke as usual. we have the google story after the break. dow is 40 points higher. we're back in just a moment. with centurylink as your trusted technology partner, you can do just that. with our visionary cloud infrastructure, global broadband network and custom communications solutions, your business is more reliable - secure - agile.

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what is google investing in? putting cash in uber, flat iron health, survey monkey, and hundreds of startups and billions of dollars. what are the areas that google cares about, and i wish we had more time. sometimes we don't know. they do things because it's not expensive, they might as well just be there if they don't have plans. >> seems that way. google, four or five years ago,

google touches, $1.5 billion under management from google itself, and like the guiding core business, which has, as you see, soared since the ipo ten years ago. google ventures lets data inform all investing moves like what entrepreneurs to invest in in what areas and in what industries. google venture has an unconventional way of awarding employees, everyone has a share, and when investments do well down to the administrative assistants, and google ventures unconventional approach helped into promising companies with industries, all over the map, consumer, enterprise, robotics, and also it's interesting to take a look at some of the companies that have gone public. retail me not, home away medicine, and uber and others they invest in through google capital, another $300 million. >> all right, john. is googly a word? >> it is.

that's how they describe themselves. >> adjective, dash y? how do you spell that? >> check with larry paige on that. >> thank you, gary. >> thank you. >> went too fast. come on back. see you soon. >> join us tomorrow, and "squawk on the street" begins right now. good morning, and welcome to "squawk on the street," i'm david faber with jim cramer, and carl has the day off. the road map starts with the markets looking to extend ral ralli rallies. they are racing around new record levels. home depot boosting guidance with better than expected second quarter results. sprins swinging, a new ceo, and now a new mobile pricing plan spurring colorful comments from the once almost merger partner, john ledger, and it's the 10th anniversary of google goi